Yet Another Way We're Getting Screwed

Think BushCo and corporate America care about average workers? Yeah, right. Slate has a great piece today on how corporations are lining up to rip off hardworking Americans by 'cramming down' pension and retirement plans. The basic M.O. is that a large corporation will promise it's workers a decent pension, work them like dogs for 30 years, and then announce that they've been underfunding their pension plan and employees are S.O.L.

Corporate America has been systematically setting up its employees for United Airlines-like cram downs. Nearly a year ago, the PBGC reported that there were 1,050 companies that had an unfunded pension liability of $50 million or more. (Collectively, their plans were underfunded by $278.6 billion.) That's up 15 times from the $18.4 billion total in 1999. The PBGC estimates that the total shortfall among all the 31,000 plans it insures is significantly higher.

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Meanwhile, the PBGC itself is in deficit. As of last September, it had only $39 billion in assets to cover the $62.3 billion in guaranteed pension benefits it owes to more than 1 million workers. In other words, it doesn't have the resources to meet even the crammed-down plans. Oh, and the PBGC, which insures pensions for 44 million workers in 31,000 plans, is bracing for more pension failures.

That's 44 million workers that might not get the full pension and retirement money promised to them by corporate America. And it's not just because the economy is bad or a particular industry has done poorly:

And even when they're flush, many healthy companies simply fail to take the steps necessary to fund the benefits. According to another study by Wilshire Associates, 81 percent of corporate pensions are underfunded. American corporate managers have collectively decided not to adequately fund the pensions and post-retirement health benefits that they promised to employees or negotiated with unions.

That's an outrage. But the real kicker is that BushCo is doing the exact same thing to American workers:

Indeed, the mother of all cram downs is shaping up this decade in Washington. For the past four years, as Americans have gone to work, played by the rules, and paid their taxes, Republicans in the White House and Congress have engineered a fiscal disaster. . . It's not that Congress and President Bush can't adequately fund Social Security. It's that they just don't want to. Instead, they want to cram us down.